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Strategic Vision, Process Innovations Propel Thermoformer's Rise
The last few years for Hampel Corporation have been marked by expansions of its facilities and staff; two consecutive years of double digit sales growth; and a strategic realignment that has refocused the company's energies on its core competencies and manufacturing excellence. And while Hampel is building its presence in growing, emerging markets throughout the world, exporting to Russia, China, New Zealand, and Australia, the company is also committed to participating in emerging industries, such as renewable energy.
"Renewable energy is an area that we're looking at closely as to ways that we might be able to serve it, whether that be wind, solar, or other [industry segments]," said Hampel Corporation President Paul Lorge. "We want to stay close because we think it's important to be close to those emerging markets."
But the company's recent growth is a bit deceiving, according to Lorge. Just four years ago, the major global recession that would later be recognized as the Great Recession of 2008-2009 was beginning to take a big toll on the company's sales revenue, ultimately wiping out nearly 40 percent of Hampel's top line over that two-year period. The company's portable restroom segment was hit particularly hard, losing about 70 percent of its volume from its highs of 2006 and 2007.
"About 70 percent of portable restrooms are used in commercial construction and residential construction, and as that market went, so went the market for portable restrooms," said Lorge. "That's why I say that growth is a bit deceiving, but if there's a silver lining or a bright outlook, we took the opportunity to make lemonade from those lemons."
Hampel (www.hampelcorp.com), located in Germantown, Wisconsin, had been in the business of designing, developing, and distributing its own models of portable restrooms for about 10 years, and manufacturing parts for the industry had become its forte. But the market had become highly fragmented, making it tough for companies to differentiate themselves from their competition. Deciding to stick with what it does best, Hampel sold its portable restroom segment to the industry's heavy hitter, Minneapolis-based Satellite Industries, and entered into a long-term supply agreement with them.
"We have become their thermoforming partner worldwide for the manufacture of their thermoformed parts," said Lorge. "Strategically, to align with the number one portable restroom distributor in the world made a whole lot of sense, and has contributed nicely to our growth."
Hampel took the opportunity during the downturn to expand its sales staff so that it would be prepared to capitalize on the upside when it came. The company also worked hard at managing, maintaining, and enhancing its relationships with its large and most significant customers and partners, such as John Deere, in an effort to demonstrate a strong commitment to meeting their needs. That way, Lorge said, Hampel would be in a strong position to support its partners "in a big and broad way" as the economy began picking up steam and business returned to more reasonable levels.
"Those are the things really that have driven our double digit growth of the last two years," he remarked. "I'm happy to say that not only have we made up that 40 percent loss, but we've exceeded our all-time highs in 2011 and are well on pace to exceed those all-time highs again in 2012."
To manage the growth that it had envisioned, Hampel added 60,000 square feet to its plant in 2010. "We added a new thermoformer, as well as two robotic trim cells," said Lorge. "In addition, we took the opportunity to realign some of our internal thermoformers and manufacturing resources to make them more efficient, make the processes leaner, and to provide for a better flow throughout our plant."
As part of the addition, which is now running at full capacity, the company was able to secure a $5.5 million industrial revenue bond. Part of that money was used to finance the addition. This summer, the company was in the process of adding another 5,000 square feet. "It's primarily office expansion, but it's also more for our tool room and for our maintenance group to better align them with where we've been growing in our manufacturing space," said Lorge. At press time, the company was also planning to begin construction on another 30,000 square foot addition.
Since June of 2009, Hampel has increased its staff by 45 team members. Lorge says that the company has added staff at all levels, from machine operators to engineering and sales, but the bulk of the additions have been in support of its manufacturing processes. "In the downturn, or the latter half of 2009, we took an opportunity to develop an aggressive plan for growth and to map out the growth coming in particular segments of our business," he noted. "Then we strategically added to our sales staff in our Animal Care division, and we added to our sales staff in our Molded Solutions division, but the bulk of our hiring has been to support our manufacturing operations."
Finding skilled labor to fill the job openings was a challenge for Hampel, even after conducting a job fair that only yielded a handful of qualified new hires. Fortunately, a local news station ran a segment in early 2012 on Hampel's expansion, resulting in a flood of applications and the hiring of more than 20 people. As echoed by many manufacturers struggling to fill positions despite the country's high unemployment rate, Lorge says a change is needed to restore the "manufacturing mentality" among young people searching for careers. Creating a "wow" factor over advanced manufacturing techniques, such as robotics and CNC machining, is critical in generating excitement in these fields. "Getting younger kids turned onto those things in high schools, in tech schools, and even in college is what's going to lead to a more efficient, brighter, and energized workforce in the manufacturing sector," he said.
Thermoforming Advantages Take Shape
Through its Molded Solutions business unit, Hampel offers a variety of custom thermoforming capabilities, including vacuum forming, pressure forming, twin sheet forming, and deep draw forming of large parts. Thermoforming generally provides customers with lower-cost tooling relative to most other plastics processes, as well as shortened lead times.
As opposed to non-plastic materials, such as steel and fiberglass, thermoforming offers lighter weight parts and molded-in color, making the process competitive for parts that would otherwise have to be painted. Large parts, which can be produced in one piece via thermoforming, highlight the light weight and cost advantages of thermoforming relative to processes in which multiple parts would be need to be produced and then fastened together. The larger the thermoformed part, the more noticeable is its difference in weight versus a comparably sized part made out of fiberglass, for example. These weight and cost advantages get the attention of many industries, especially transportation.
Vacuum forming, a process that involves evacuating the air between a heated sheet of plastic and the mold, is suited for such products as truck bedliners, belt shields, and motorcycle fairings. According to Lorge, Hampel has a number of core competencies within vacuum forming, including its deep draw capability and tool design expertise. In addition, the type of equipment that the company uses enables it to produce large, deep-draw parts made in one piece instead of multiple pieces. Tooling is also relatively inexpensive in the straight vacuum forming process because it's usually a cast aluminum type tooling.
Pressure forming applies pressure to the backside of a thermoformable sheet of material. The process then applies additional force to enable the material to conform precisely to the surface of the mold. With pressure forming, a part can be produced that has the same detail and cosmetic look as an injection-molded part, but with lower-cost tooling and shorter lead times to get parts from design to production, Lorge explained. Even with straight vacuum forming, highly-cosmetic looks can be achieved with engineered materials that have Class A automotive-type finishes. Using cast acrylics, PPO materials, and various films that can be put over substrates, the company can create parts that have a showroom appearance and an automotive-type finish.
Hampel uses the deep draw process to produce parts up to 70 inches deep; its capabilities include a 7 foot by 11 foot tool size. While the capability of the equipment is important, the real key with deep drawing is tool design. The company's experience comes into play with designing tools to enable the production of parts with an even finish and nominal wall thickness.
"Without that tooling knowledge, you end up with a product with the surface varying, and significantly varying in thickness," said Joseph Weber, Hampel's marketing manager. "So you would have weak points in some areas, and thicker in others. If designed properly, the tool design will allow for more uniform thickness across the entire surface plane of that product."
With twin-sheet forming, which uses tooling for the top and bottom, two separate sheets are heated and formed into each of the tools. When the tools are brought together and machined at key areas, the material actually welds together, enabling the creation of hollow parts.
"The advantage of that process is that structurally, you can create inherently stronger parts by creating structure in one of the two tools, and you can encapsulate things between those tools," Lorge explained. One of the big advantages is that the finished part can be made in two colors by utilizing two different-colored sheets, as opposed to other processes, such as rotational molding or blow molding, where it's not possible, he said.
Designing for Innovation
Hampel has developed a patented Selective Twin Sheet molding process that involves the use of offset twin-sheet molding. Using this process, Hampel was able to manufacture a waste management dumpster lid that featured superior strength in a vulnerable area—the hinge. The problem arose when the dumpsters were being lifted by garbage trucks, putting excessive force on the hinge area and causing the lids to break in half. Seeking a stronger hinge, the customer had tried increasing the overall gauge of the plastic. Unfortunately, this method added cost without any resulting benefit because it used more material across the entire lid, rather than just at the hinge, where the part failures were occurring. Instead of adding thickness to the entire lid, Hampel developed an offset-molding process that added material only where it was absolutely needed.
"So you're not adding cost to the entire part; you're just adding material where it's needed and keeping the cost of the final product down," Lorge said. "The fact that these twin sheet tools are offset is the key thing. It's an offset twin sheet molding process that allows us, through proprietary technology, to offset the tools in a manner that allows production of multiple parts at one time, and only directing additional material in the areas where those two parts meet at that offset area, to create the selective twinning or double thickness."
Hampel came up with another innovative design that used the offset twin sheet molding process on a return air bulkhead that protects the refrigeration unit on a semi-trailer from being damaged when it's being loaded or transported within the trailer. As the product was being loaded onto the trailer by forklifts, a significant amount of abuse was occurring during impact at the bottom 12 inches of the part. Rather than make the entire part thicker to protect the bottom 12 inches, Hampel used the offset twin sheet molding process to make the part thicker only in certain areas. "We were able to reinforce or create the thickness required to take that abuse in that lower 12 inches and not add cost to the balance of the part," Lorge explained.
The company has also patented a steel reinforced pallet, Steelspan, which combines the integrity of injection-molded structural foam pallets with significantly lower tooling costs. "We're taking two completely different materials with different expansion characteristics—steel and plastic—and we're encapsulating that steel within the plastic," Lorge said. "You would think that it would bend and twist and crack, but we've developed a patented way of doing that so that we can create a pallet that basically can take the same amount of weight as a structural foam pallet," Lorge said. "But again, the tooling costs are lower because it's a thermoformed tool; it's not an injection mold or structural mold type tooling."
Hampel's engineers in its Calf-Tel business unit often work directly with end users of the product, giving them an advantage that they can share with the engineers in the Molded Solutions division.
"Our design team and our engineers span the full gamut of working directly with a customer that might be a farmer in Russia or a producer in Russia or Germany, to working at a very technical level with one of our largest OEM customers," said Lorge. "There's a different perspective when either your technical sales team or your engineering team is dealing direct with that very end user, or that producer, as opposed to when that engineering team is dealing direct with another engineer, who's dealing with a product manager, who's ultimately dealing with a customer. Because of that proprietary offering, our team has the perspective of going direct to the end user and leveraging that, and understanding deeply what the customer wants, what that end user wants, and being in tune with that. It's something that the proprietary Calf-Tel offering affords us, and allows our entire team to be focused on."
At the same time, the interactions between the engineering teams at Calf-Tel and Molded Solutions are a two-way street. Knowledge gained by the engineers working on precision or highly cosmetic applications in the Molded Solutions division can be shared with engineers in the company's other product lines. "We're able to leverage the demands of some of our larger OEM customers as it relates to high-end trimming capabilities, robotics, and CNC solutions, and leverage that the other way across the other product lines that aren't necessarily demanding the same level of precision," said Lorge.
Hampel's Calf-Tel business is doing exceptionally well, coming off what Lorge says was a very good year for dairy producers in 2011. But the company doesn't plan to stand pat, and has an aggressive plan for gaining and expanding worldwide distribution. "We're capitalizing on that plan and executing according to that plan--signing up distributors in New Zealand and Australia, getting deeper into producers in China and Russia," said Lorge. "Those last two are some of our fastest growing emerging markets right now."
"The thermoforming process is key to that growth in that, because of the process, we can produce an extremely durable part at a lower weight, and it nests very efficiently," said Weber. "We can ship these very efficiently all over the world. We're the only thermoformed product on the global market that we're aware of. So we're able to ship more, at less cost, than any of our competitors, and it's product that's superior to what's out there."
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